Nucor earnings beat by $0.08, revenue fell short of estimates
Tuesday, Zoom Video Communications Inc (NASDAQ:ZM) shares witnessed a slight decline after Piper Sandler confirmed a Neutral stock rating with an $89.00 price target. The reiteration follows Zoom’s fiscal fourth quarter results, which aligned closely with expectations, and a minor miss in the sales guidance for the first quarter and fiscal year 2026. According to InvestingPro data, analyst targets for Zoom range from $75 to $115, with 23 analysts recently revising their earnings expectations upward for the upcoming period.
Zoom’s revenue growth is being driven by its newer products such as Customer Experience (CX) and Workvivo, according to the research firm. The company is also expected to benefit from the end-of-life (EOL) of Amazon (NASDAQ:AMZN) Chime, a competing service, and a new partnership with Mitel. The company maintains impressive gross profit margins of 76% and has demonstrated solid financial health, with InvestingPro analysis indicating the stock is currently trading below its Fair Value.
The management’s decision to discontinue reporting the Direct customer count metric was highlighted by Piper Sandler. This move may be perceived as a warning sign that customer growth could be plateauing. Additionally, the firm noted that the growth seems to be stemming from extending contract durations and cross-selling, which may be compensating for the core business challenges.
Despite these developments, Piper Sandler expressed a preference for other companies within the sector. The firm’s stance remains neutral, suggesting investors may want to explore alternatives in the market space.
Zoom’s core business continues to face pressure, and while the company is making strides with new products and partnerships, Piper Sandler’s outlook suggests cautious optimism. The reaffirmed price target of $89.00 reflects the firm’s current assessment of Zoom’s market position and potential for growth.
In other recent news, Zoom Video Communications Inc. reported its fourth quarter earnings for 2025, surpassing analyst expectations with an earnings per share (EPS) of $1.41, compared to the forecasted $1.30. The company’s revenue for the quarter was $1.184 billion, aligning with predictions, while enterprise revenue grew by 6%, now making up 60% of the total revenue. Despite these positive financial results, Zoom’s stock experienced a decline in after-hours trading. The company also reported a 25% increase in free cash flow year-over-year, reaching $416 million. Zoom’s strategic focus on the enterprise market and advancements in AI have been highlighted as key components of its growth strategy. Analysts have shown interest in Zoom’s AI capabilities as a significant growth driver, with the company planning to continue investing in AI and platform expansion. For the fiscal year 2026, Zoom projects revenue between $4.785 billion and $4.795 billion, representing a 2.7% growth.
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